14 June 2024 | FXGT.com
Yen Falls to One-Month Low After BoJ Maintains Bond-Buying Pace
- Yen Falls After BOJ Decision: The Japanese Yen remains under selling pressure on Friday as markets assess the Bank of Japan’s (BoJ) monetary policy announcements. After the announcement on Friday morning, the yen fell to a one-month low as the BoJ maintained its current bond-buying pace and deferred tapering plans, leading to a continuation of its recent downtrend.
- BOJ Maintains Policy Rate and Bond Purchases: As expected, the BOJ kept its policy rate at 0% for the second consecutive meeting in June. Many had expected the bank to outline a pathway for tapering the amount of government bonds being purchased per month, but this was postponed to the next meeting.
- Future Reduction Plans and Market Stability: Governor Kazuo Ueda stressed the importance of reducing Japanese government bonds purchases gradually while maintaining flexibility to ensure bond market stability. The BOJ plans to decide on a specific reduction plan for the next 1-2 years at the July meeting.
- US Fed Outlook: The number of Americans filing new claims for unemployment benefits rose to a 10-month high last week, while producer prices unexpectedly fell in May. Despite softer-than-expected inflation data, the Fed’s revised dot plot reduced rate-cut expectations this year from three to one. Investors are considering the implications of the Fed’s tempered rate-cut views, with the dollar hovering near a one-month high.
- US Inflation Data Impact: The Fed is likely to remain patient, waiting for sustained progress on inflation, and may start its monetary easing campaign in December. Traders, influenced by recent inflation reports, are pricing in 50 basis points of cuts this year, with a 68% probability of a September rate cut.
- Upcoming US Economic Data: The US economic calendar will feature Export Price Index and Import Price Index data for May. Later in the session, the University of Michigan will release the preliminary Consumer Sentiment Index for June.
Help us improve this article.
Submit additional feedback
Disclaimer: Any material and information included herein are intended for general marketing purposes only and does not constitute investment advice or recommendation nor an invitation to acquire any financial instrument and/or be involved in any financial transaction. The investor is solely responsible for the risk of his investment decisions and if considers appropriate, he should seek relevant independent professional advice before making any decision. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. Please read full Non-Independent Investment Research Disclaimer
here.
Risk Disclosure: CFDs are complex instruments and carry a high level of risk of losing money. Read full Risk Disclosure
here .
